CFNB Third Quarter Earnings Up 9%, With 36% Increase For Nine Months

California First National Bancorp (NASDAQ:CFNB) (“CalFirst Bancorp”)
today announced that net earnings for the third quarter ended March 31,
2010 increased 9% to $2.

California First National Bancorp (NASDAQ:CFNB) (“CalFirst Bancorp”) today announced that net earnings for the third quarter ended March 31, 2010 increased 9% to $2.6 million from net earnings of $2.4 million for the third quarter of fiscal 2009. For the nine months ended March 31, 2010, net earnings of $9.1 million were 36% above the $6.7 million reported for the first nine months of fiscal 2009. Diluted earnings per share for the third quarter of fiscal 2010 were up 8% to $0.25 per share, compared to $0.23 per share for the third quarter of the prior year. Diluted earnings per share for the first nine months of fiscal 2010 were up 38% to $.89 per share, compared to $.64 per share for the same period of the prior fiscal year.

Gross profit for the third quarter of fiscal 2010 of $7.1 million was essentially unchanged from the third quarter of the prior year. Total direct finance, loan and interest income decreased 14% to $6.6 million compared to $7.6 million during the third quarter of the prior year. The decrease was primarily due to a 17% decrease in direct finance income resulting from a lower average investment in capital leases and lower yields earned, and a $326,000 decrease in investment income as yields earned dropped by over 150 basis points. Together, this drop offset a $169,000 increase in loan income that resulted from a 105 basis point improvement in commercial loan rates earned. Combined, the average yield on leases and loans held in the Company’s own portfolios decreased by 58 basis points to 8.3%. During the third quarter of fiscal 2010, interest expense on deposits and borrowings decreased by $632,000 to $1.1 million, reflecting a 5% decrease in average deposit and borrowing balances to $220.4 million and a 100 basis point decrease in average interest rates paid to 2.0%. For the third quarter of fiscal 2010, the Company did not make a provision for credit losses as the average investment in leases and loans was down 5%. All of these factors combined for a 2% decrease in net direct finance, loan and interest income after provision for credit losses to $5.5 million.